Understanding credit card
interest-free periods
A credit card interest-free period is the time between making a purchase on your card and when interest may begin to apply to that purchase.
Understanding how your credit card billing cycle, statement and payment due date work together can help you make the most of this feature.
What is a credit card interest-free period?
A credit card interest-free period (also called ‘interest-free days’) allows you to make new purchases without paying interest for a period of time, provided you meet the applicable repayment conditions.
What ‘up to 55 days interest free’ typically means
You'll often see American Express Credit Cards offering up to 44 days or up to 55 days interest free1. This refers to the maximum number of interest-free days available on eligible credit cards. The actual number of days depends on when you make your purchase within your statement period (also known as your billing cycle). Purchases made earlier in the billing cycle generally receive more interest-free days than those made closer to the end of your billing cycle.
For example, a typical statement period is 30 days. On a card with up to 55 interest-free days, there would be 25 days after the billing cycle ends to pay the closing balance and avoid being charged interest.
When do interest-free periods apply?
Credit card interest-free periods usually apply to your new purchases, such as everyday spending, online shopping, travel bookings and household bills.
They won't apply if you carry forward a balance from a previous statement, don't pay your full closing balance by the due date or make transactions that are excluded under your card's Terms & Conditions.
Here is a quick summary on how interest-free days work.
Using interest-free periods to manage spending
An interest-free period can help with everyday spending by giving you time between making an eligible purchase and paying for it.
Managing everyday purchases
An interest-free period may help when regular costs, such as groceries, transport, or household bills, fall at different points in the month.
Rather than each purchase needing to be paid immediately, eligible purchases are brought together in your statement, giving you a clearer view of what is due and when.
Check out what you can use your credit card for.
Planning for large purchases and travel bookings
For larger purchases or seasonal spending for travel or holidays, the interest-free period may help by giving you a defined window between making those purchases and needing to pay your closing balance.
This can make it easier to space purchases across a busy period, rather than having every cost leave your account immediately.
The benefit is visibility and timing, not reduced cost. You still need to be confident that you can pay the full amount due.
Managing everyday purchases
An interest-free period may help when regular costs, such as groceries, transport, or household bills, fall at different points in the month.
Rather than each purchase needing to be paid immediately, eligible purchases are brought together in your statement, giving you a clearer view of what is due and when.
Check out what you can use your credit card for.
Planning for large purchases
and travel bookings
For larger purchases or seasonal spending for travel or holidays, the interest-free period may help by giving you a defined window between making those purchases and needing to pay your closing balance.
This can make it easier to space purchases across a busy period, rather than having every cost leave your account immediately.
The benefit is visibility and timing, not reduced cost. You still need to be confident that you can pay the full amount due.
Interest-free periods on American Express Cards
Accessing up to 55 days interest free
Eligible American Express Credit Cards in Australia offer up to 44 or 55 interest free days on purchases1. The exact number of interest-free days available will depend on the card, your method of payment, when you make a purchase, when your statement is issued and whether or not you are carrying forward a balance on your account from your previous statement period. Please note that if you pay by direct debit, your payment will be processed 10 days after your statement is issued.
You can use your Online Account to keep track of your closing balance and payment due date.
Explore our cards with interest-free periods.
Other payment flexibility solutions available with Amex
Plan It®
With American Express Credit Cards, you can opt to pay off a portion of your card balance or an eligible transaction in equal monthly instalments over 3, 6, or 12 months2 with Plan It®. There is no interest, but a fixed monthly fee applies.
Learn more about paying in instalments.
Cover Charges with Points
American Express Card Members enrolled in Membership Reward® program can choose to reduce their card balance by using rewards points to pay off eligible transactions with Cover Charges with Points3.
Explore more Amex payment flexibility solutions
Interest-free days vs cash flow days
Credit card interest-free periods and cash flow days are both designed to provide flexibility between making purchases and making payments, but they apply to different types of American Express Cards and work in different ways.
Interest-free periods are a feature of credit cards. Eligible Amex Charge Cards such as the American Express® Platinum Card and Amex Business Charge Cards instead offer cash flow days4.
What are cash flow days on charge cards?
- Cash flow days refer to the period between making an eligible purchase on an Amex Charge Card and your payment due date. Unlike a credit card, a charge card does not have an interest-free period because the balance is generally due in full each statement cycle. Learn more about charge cards.
- As for interest-free periods, the number of cash flow days you receive depends on your card, when you make a purchase within your billing cycle. Purchases made earlier in your statement period will have more cash flow days before payment is due than purchases made closer to the end of your billing cycle.
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Choosing the right payment solution for your needs
Whether an interest-free period or cash flow days is more suitable depends on the type of card you're looking for and how you prefer to manage your spending.
Comparing the features, eligibility requirements and payment terms of each card can help you choose the option that best suits your needs. |
How does a Charge Card work?
When you use a Charge Card to make purchases, those transactions are added to your monthly statement.
At the end of each billing cycle:
Unlike a Credit Card, a Charge Card does not usually allow you to carry a balance month to month. |
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Choosing the right payment solution for your needs
Whether an interest-free period or cash flow days is more suitable depends on the type of card you're looking for and how you prefer to manage your spending.
|
Choosing the right payment solution for your needs
Whether an interest-free period or cash flow days is more suitable depends on the type of card you're looking for and how you prefer to manage your spending.
Comparing the features, eligibility requirements and payment terms of each card can help you choose the option that best suits your needs. |
Frequently Asked Questions
Your credit card billing cycle, also known as your statement period, is the period during which your credit card transactions are recorded before your monthly statement is issued.
An interest-free period is the time between making an eligible purchase and when interest may begin to apply. The length of your interest-free period depends on where your purchase falls within your billing cycle and whether you meet the applicable repayment conditions.
Yes. If you don't pay your full closing balance by the payment due date, or if you've carried forward a balance from the previous statement period, interest may apply to eligible purchases in accordance with your card's Terms and Conditions.
Not necessarily. Paying only the minimum payment helps keep your account in good standing, but it may not preserve your interest-free period. To avoid interest on eligible purchases, you'll generally need to pay your full closing balance by the payment due date and meet the applicable repayment conditions.
No. Interest-free periods are a feature on Amex Credit Cards1. Amex Charge Cards don't offer interest-free periods. Instead, they may offer cash flow days4, which provide time between making eligible purchases and paying the statement balance by the due date.
No. While both features provide time between making a purchase and making a payment, they work differently. Interest-free periods apply to credit cards and are subject to repayment conditions. Cash flow days are available on charge cards, where the card balance is generally due in full each statement cycle.
1. Interest free days. Depending on your method of payment, when you make a purchase, when your statement is issued and whether or not you are carrying forward a balance on your account from your previous statement period. If you pay by direct debit, your payment will be processed 10 days after your statement is issued.
2. Plan It® Instalments. You can create an Instalment Plan as long as your account is in good standing. We may withdraw this offer, prevent you from creating any new Instalment Plans or cancel any of your existing Instalment Plan(s) at any time if your Card Account is overdue, or if you do not comply with your Card Conditions.
The minimum Plan amount is AUD$100. We may also limit the amount that can be transferred to an Instalment Plan.
You will be charged a Monthly Plan Fee for each Instalment Plan created (unless a promotional plan is available). This fee will be charged each month your Instalment Plan is active and will be disclosed to you at the time of creating your Instalment Plan.
Each Instalment Plan will begin from the date it is successfully created, as communicated to you in your Online Account.
Payment of your first Monthly Instalment will be due in your next payment cycle.
You may request to cancel your Instalment Plan(s) at any time through your Online Account or the Amex App. Any billed Monthly Plan Fees will remain payable, but no further Monthly Plan Fees will be billed after cancellation is effective. As cancellation can take 24-48 hours to process (“Processing Time”), you may be charged a further monthly plan fee after requesting cancellation if the Processing Time occurs on your payment date.
View the full Plan It® Instalment Terms and Conditions here.
3. Cover Charges with Points. For each successful transaction using Cover Charges with Points, points will be debited from your Membership Rewards account and a credit placed on your Card in line with the points chosen to be used for the Eligible Charge. A minimum of 1,000 Membership Rewards points is required to cover any eligible transaction with points. Any credit to your Card account cannot exceed the amount of the relevant Eligible Charges. A credit will appear on your statement identified as “Membership Rewards Credit”. Points will be debited immediately and the credit will take up to 3 business days to appear online. Credits processed after the Card account’s statement closing date will appear in the following statement. You are still responsible for payment of the amount due on your Card account by the due date. Any charges covered by points is not redeemable for cash via Credit balance refund. American Express will select and display each eligible charge that can be covered with points (“Eligible Charge”) and the points rate required to cover the Eligible Charge. Each Eligible Charge must: (a) appear within the Online Statement of the Summary of Accounts page; (b) be redeemed within 2 months of the charge appearing on your Card account; (c) not currently or have previously been disputed; and (d) not be a fee. Eligible Charges, including the points rate required to pay for the Eligible Charge, may be changed at any time without notice. Eligible transactions can be covered by points via your online account or American Express mobile app. Covering charges with points is available only to Basic Cardmembers enrolled in the Australian Membership Rewards program and is subject to the full Membership Rewards Terms and Conditions. Authorised agents, authorised account managers, additional Cardmembers and Authorised Additional Cardmembers are not eligible. All Linked Card accounts must be in good standing. For more information on Cover Charges with Points click here.
4. Cash Flow Days. Depending on your method of payment, when you make a purchase, when your statement is issued and whether or not you are carrying forward a balance on your account from your previous statement period. If you pay by direct debit, your payment will be processed 10 days after your statement is issued.